Global value chains and corporate interests of multinational corporations

Modern stage of development of the world trade is characterized by phenomenon of Global value chains (GVC), which means a situation when the final good at each stage of production is produced in different regions of the World. This trend mainly can be attributed to separate production units within Multinational Corporations (MNCs) rather than to different countries. Generally, there is a positive correlation between the share of inward foreign direct investments (FDI) in GDP of a specific country and the level of its participation in GVCs and its internal value added in the export: the higher the former, the bigger is latter. So it is becoming more and more important for individual economies to integrate into existing GVCs. The author outlines positive and negative effects of countries' participation in GVCs, which are created and controlled by foreign MNCs. Additionally, the article explains the mechanism of MNCs' impact on GVC development. Today we can see that a new trend of the international trade is the growing role of MNCs from emerging countries like China and India. So the main conclusion is that in order to benefit from participation in GVC countries need to stimulate the creation and growth of their own multinationals.